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									         GREATER MANCHESTER WASTE DISPOSAL AUTHORITY
                      - 20th OCTOBER 2006


                     REPORT OF THE EXECUTIVE DIRECTOR


                                     RE-USE CREDITS


1.      PURPOSE OF THE REPORT

        To inform Members of progress by the Joint Officers Group (JOG) who have
        been developing a partnership approach regarding the payment of re-use
        credits.

2.      BACKGROUND

        The Clean Neighbourhoods and Environment Act 2005 introduced the ability
        for waste disposal authorities to pay credits for re-use. Previously reported to
        the Authority was the establishment through JOG of an Officer Working
        Group to develop proposals and investigate current practices.

3.      INFORMATION

        The JOG Working Group has met on several occasions this year and
        developed outline proposals which provide for the payment of re-use credits.
        A report to the JOG is attached as Appendix 1. At their meeting on 11th
        October, the recommendations outlined in that report were unanimously
        agreed insofar as:

        3.1      The scheme will be centrally administered by the Waste Disposal
                 Authority and the recovery of expenditure on credits paid be recovered
                 from the respective districts for the source of the waste;

        3.2      JOG confirmed that community groups and registered charitable
                 organisations would be able to apply for re-use credits;

        3.4      The scheme be limited to furniture and white goods (in respect of
                 white goods, this be payable until the introduction of the producer
                 responsibility Waste Electrical and Electronic Equipment (WEEE)
                 Regulations come into force due 1st July 2007);

        3.5      JOG develops a publicity campaign to inform eligible organisations of
                 the scheme.




[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]
4.      COMMENTS OF THE SOLICITOR TO THE AUTHORITY

        4.1      This will enable compliance with the statutory requirements.

5.      COMMENTS OF THE TREASURER TO THE AUTHORITY

        5.1      To the extent that the application of the Re-use Credits Scheme
                 removes material from waste streams, any cost impact should be
                 negligible and will mainly involve administration of the scheme.

        5.2      However, where re-use credits are applied to goods which are already
                 outside the waste streams, this will represent an additional cost to the
                 Authority. The full impact of this needs to be assessed in coming
                 months and is a budget pressure.

        5.3      The method by which re-use credits paid out are to be recovered from
                 Districts will be considered as part of the Levy discussions.

6.      RECOMMENDATIONS


Members are requested to:

         6.1     note the progress of JOG;

        6.2      request the Executive Director to bring a report to the next meeting of
                 the Authority finalising the arrangements for the scheme.

                                  ---------------------------------

The following is a list of the background papers on which this report is based in
accordance with the requirements of Section 100D(1) of the Local Government Act
1972. It does not include documents which would disclose exempt or confidential
information, as defined by that Act.




P. Dunn,
Executive Director,
11th October 2006




[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]
                                                                         APPENDIX 1


The Reuse Credit Working Group has explored the aims and objectives agreed by
JOG. The following report details the recommendations of this group as a result of
investigation into regulatory guidance; existing schemes; and feedback from members
of JOG.

    1.0 Potential tonnages that may be claimed for reuse credits

            1.1 The 2005 / 2006 tonnage of bulky household waste collected and
                fridges / freezers* has been used to provide a base for estimates of
                potential reuse figures.

            1.2 Existing reuse groups, currently operating across Greater Manchester,
                are also collecting bulky waste. Furniture Reuse Network (FRN)
                figures show 2028 tonnes of bulky waste were reused in 2005/06, of
                which 432 tonnes comprised of white goods*. These figures are
                incorporated into the calculations.

            1.3 For existing schemes, nationally, the proportion of reused materials
                derived from bulky waste collection schemes can range from 5% to
                60%. The range is due to a number of variables that can affect the
                capture rate.

            1.4 For the purpose of this estimate, working figures from the FRN will be
                used, as detailed below.

            1.5 Typical reuse schemes can be divided into two specific groups –

    A. Collection and distribution of only the items that can be immediately reused,
       with no refurbishment required.
    B. Schemes with workshop facilities to repair and refurbish items.

            1.6 Group A can expect to capture an average of 7.5% of bulky waste
                tonnage for reuse, whereas Group B are more likely to gain an average
                of a further 15% of the tonnage – giving an estimated, overall 22.5%
                capture rate.

            1.7 For the Household Waste Recycling Centres, the National Assessment
                of Civic Amenity Sites (NACAS) estimates that 4% of tonnage from
                these sites is furniture.

            1.8 Using the above assumptions, and FRN educated estimates for existing
                groups’ current capabilities under Group A or B, it is estimated that
                Greater Manchester’s HWRCs could expect a 7.5% capture rate of
                furniture tonnage for Group A and a further 1.5% for Group B.

            1.9 This equates to a total 9% of furniture arisings from HWRCs -
                equivalent to 1048 tonnes in 2005/06 - that could be diverted for reuse.


[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]
            1.10         Please refer to 2.5 for a summary table of tonnage projections,
                         along with financial implications.


(*Please see section 3.2 below).

2.0 Financial Implications of a reuse credit scheme

2.1 The Environmental Protection (Waste Recycling Claims) Regulations 2006
    remain the basis for calculating credits. This guidance requires that credit values
    should be the same for reuse as they are for recycling.

2.2 For 2006/ 2007 the disposal recycling credit value is £36.50.

2.3 In order to estimate potential costs, the 2005/06 tonnage will be increased by the
    1% predicted growth for 2006/07, and again for 2007/08.

2.4 The recycling credit rate for 2007/08 will be provisionally estimated at £39.90.

2.5 Using the above figures, assumptions and estimates, the summary of estimated,
    overall tonnages costs is:

                                                                           Total
                         Bulky     Fridges /          Grand                minus
                                             HWRCs(4)
                         Household Freezers           Total                Fridges    /
                                                                           Freezers *
 2005/2006 actual
                         48099           1386         291000    340485     339099
 tonnage(1)
 Reuse          group
                         1596            432          0         2028       1596
 collections(2)
 2005/2006
                         49694           1818         291000    342512     340694
 tonnage total
 Potential 2005/06
                         11181           409          1048      12638      12229
 reuse tonnage(3)
 Estimated
 2006/2007               50191           1836         293910    345937     344101
 tonnage total(5)
 Potential 2006/07
                         11293           413          1058      12764      12351
 reuse tonnage(3)
 Potential reuse
                         £412,195        £15,080      £38,620   £465,894   £450,815
 credits 2006/07(6)




[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]
 Estimated
 2007/2008            50693     1855        296849      349397    347542
         (5)
 tonnage
 Potential reuse
 tonnage              11406     417         1069        12892     12475
 2007/08(3)
 Potential reuse
                      £455,097  £16,649     £42,639     £514,385 £497,736
 credits 2007/08(7)
 *See section 3.2
 (1) GMWDA actual figures
 (2) FRN provided
 figures
 (3) Based on FRN advised average percentages - Grp A 7.5%+ Grp B 15%=22.5%
 of each tonnage total.
 (4) HWRC figure =FRN model estimate of 4% furniture in tonnage - capture rate
 Grp A 7.5%+Grp B 1.5%= 9%
 (5) Assumed 1% annual increase on previous year's
 tonnage
 (6) At 2006/07 Recycling Credit rate of
 £36.50
 (7) At 2007/08 Recycling Credit rate of
 £39.90

3.0 Types of materials we would apply to reuse criteria

3.1 It is suggested that reuse credits should only apply to furniture and white goods
    collected by community groups and registered charity organisations. This model
    has also been applied in Lancashire and is operating successfully.

3.2 However, it must be noted that payments for white goods will only be applicable
    until 01July 2007 when the WEEE directive is due to be implemented.
    Following this, reuse credits will no longer be applicable to these items.

4.0 Potential ways to monitor and evaluate reuse schemes

        4.1 There will need to be very clear audit trails for items put through the
            scheme, requiring the co-operation of individual WCAs.

        4.2 Background research into existing schemes and FRN systems has shown
            there is considerable experience to draw upon when selecting the most
            appropriate methods for Greater Manchester.

        4.3 The options for how the monitoring procedures will satisfy the appropriate
            audit trail will be established after scheme principles have been agreed and
            prior to implementation.

5.0 Examine other successful schemes in the UK and what criteria they applied




[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]
5.1 The group visited Lancaster City Council’s contractor Furniture Matters/Bulky
    Matters to assess how they administered and operated their reuse credits system.

5.2 Furniture Matters is a charity organisation collecting and refurbishing furniture
    etc. for redistribution, mainly via a system of referrals. The charity claims reuse
    credits from Lancashire County Council.

5.3 Bulky Matters is a partnership between Furniture Matters and Lancaster City
    Council to deal with the Council’s bulky collection. Lancaster City Council
    claim reuse credits from Lancashire County Council.

5.4 Both operations use the same system of tracking and accounting for goods
    collected. Items are currently labelled for identification purposes but this will
    shortly be changed to a method of bar coding. The payment claimed is for the
    items redistributed, not for the items collected.

5.5 The system used to track items throughout the process is called “Contender”
    (produced by Data Pro, Bristol) which is used by a number of Local Authorities.
    Lancaster City Council does not use this same software but is currently in the
    process of writing software to link the two systems. It was clear that a good
    tracking system is imperative for the system to work.

5.6 Using this tracking system it is possible to identify items being returned to the
    scheme for the second time, where no credits will be paid. It also identifies any
    addresses where multiple deliveries are requested and so prevents any goods
    being claimed for resale. Goods are not left without the householder signing for
    delivery. The refurbished items are normally provided to low-income families
    who are issued with a membership card after being referred by health or social
    workers.

5.7 Lancashire County Council audit Furniture Matters annually and Bulky Matters
    quarterly.


6.0 Obtain information of effective audit trails for materials that are reused

6.1 As for section 4, there is a considerable amount of experience and information
    available on which to base Greater Manchester’s audit trail.

6.2 Lancashire uses a model where set weights are applied to set items of furniture.
    Agreed standard weights for collected items are derived directly from the
    Furniture Recycling Network’s figures as these are accepted nationally and
    recognised by Defra, Cred and Brew etc. Information is also provided in Waste
    Data Flow guidelines.

6.3 These weights are applied to each item at point of sale for a claim to be made. The
    weights can be viewed at:

      www.frn.org.uk/code/info_and_stats/weights.asp



[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]
6.4 Full details of the recommended audit regime will be established and circulated to
    JOG following the agreement of the main principles of the scheme.


7.0 Consider the administration of a reuse credit scheme

7.1 The administration of the scheme can be done by districts or centrally by the
    waste disposal authority. A number of the schemes may overlap authorities and
    hence it may be more appropriate to administer this centrally. The WDA could
    administer the payments and would propose payments are allocated against the
    tonnages diverted from that individual Authority

7.2 The ability exists for WCA well-being powers to be used to pay credits
    directly. Any scheme suggested will require WDA approval before this can
    be done - if this option is taken the WDA would require evidence of audit
    procedures being complied with. This is due to the statutory responsibility
    being placed by central Government on the WDA.

7.3 Should the payments be made by the WCAs or the WDA, the costs will still
    ultimately be borne by the WCAs (ie whether these costs are derived from direct
    payments from the WCAs, or via the levy. In the case of the levy this would be
    on a council tax basis unless agreed as proposed in 7.1).

8.0 Explore eligibility criteria for which credits should be applied

8.1 Reuse credit payments are equivalent to the cost of recycling credits (reviewed
    annually).

8.2 Reuse credit payments are made on a discretionary basis for household waste
    only.

8.3 Organisations claiming must be community groups and registered charitable
    organisations.

8.4 Payments in respect of furniture reuse schemes to be based on the agreed weight
    of refurbished furniture published by the Furniture Recycling Network (see
    section 6.0).

8.5 An appropriate audit trail should be established for deliveries of household items
    to ensure validity of claims. This audit trail must meet with the approval of
    GMWDA before any claims are made.

8.6 Claimants must follow the procedures and meet the criteria as set out in the
    GMWDA recycling credits scheme.

8.7 Organisations will only be eligible for reuse credits when operating an agreed
    minimum throughput of tonnage.




[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]
9.0 Explore the possibilities of campaign and public relations benefits to operating a
    reuse scheme

9.1 The scheme should be publicised to ensure all groups capable of undertaking
    this type of operation are aware of the scheme and to make the scheme public
    knowledge, in order to maximise reuse and reduce disposal.


10.0 Recommendations

        1. That JOG discusses and agrees how the scheme should be administered.
        2. That JOG agrees community groups and registered charitable
           organisations will be able to apply for reuse credits.
        3. That JOG agrees reuse credits should apply to furniture and white goods
           (taking into account that white goods will come under the WEEE directive,
           when implemented – see 3.2).
        4. That JOG proposes when the scheme should be publicised and launched.

The approval of the WDA will be required at the next Authority meeting. A detailed
report with all factors on the above, together with budgetary implications, will be
required.

The latest date on which papers can be circulated is 15 December 2006.




[Doc. Ref: wda/20 Oct 2006 Rpt RE-USE CREDITS/P. Howarth/jm]

								
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